I am Founder and Principal at Bersin by Deloitte, leading provider of research-based membership programs in human resources (HR), talent and learning. Hundreds of the Global 2000 and Fortune 1000 use our proven people strategies to drive exceptional business results.

I've spent much of my career in technology, sales, marketing, and business leadership and I actively write about major global trends in leadership, management, HR and talent management technologies. I live in the San Francisco area, close enough to Silicon Valley to keep up with new technology and its impact on the business of talent.

LinkedIn is Disrupting the Corporate Recruiting Market

The company reported 105% YTY growth in quarterly revenues to $167.7 Million, putting the company on a 2012 plan of $860 Million.

But the real story is the huge jump in revenues from LinkedIn’s recruiting services (“Hiring Solutions”). Revenues in this segment grew by 136% to $84.9 Million, making the company the fastest growing public provider of corporate recruiting solutions.

To give you a sense of how dramatic this is: LinkedIn’s recruiting revenues are now greater than Taleo’s (which was just acquired by Oracle for $1.9 Billion) and within the year could reach the size of Monster.com. Monster’s recruiting revenues were $250 million last quarter and only grew by 2%.

And this growth is just beginning. The company offers a wide range of recruiting solutions now includes:

LinkedIn Recruiter (the company’s recruiting platform) gives companies access to the entire database of 150 million professionals to find and seek passive candidates,

LinkedIn Job Postings, lets you post jobs and buy highly targeted ads (LinkedIn ads are very intelligent and they promote themselves to LinkedIn users in a very powerful way), and our research shows that they can be much more effective than ads placed on Facebook for professional positions,

LinkedIn Employment Branding services now let you build out a career website within the LinkedIn network, to attract candidates, promote jobs to the right people,

Even though LinkedIn’s original vision was to become a professional social network to bring people together, it has become “the place” for professionals to network, look for jobs, and “be found” by employers.

There are many elements to the recruiting marketplace, including the market for applicant tracking software (Taleo, Lumesse, Kenexa), assessments (SHL, Kenexa, DDI, and hundreds others), recruitment services providers (often called agencies or RPOs), candidate relationship management systems (hot tools like like Jobs2Web, just acquired by SAP), social referral systems (like JobVite), and interviewing tools (hot companies like HireVue). But the hottest part of this market is tools for sourcing.

Sourcing is the difficult and often highly secretive process of “finding the right candidates” – seeking them out, contacting them, getting them interested in your position, and then bringing them into your screening and assessment process. We used to have to hire a contract recruiter (or Korn/Ferry, Heidrick & Struggles, and hundreds more) who has deep skills in locating candidates, vetting their skills, and attracting them to your position.

Now, these companies are all using LinkedIn to replace their own networks, and corporate recruiters are going through an enormous transformation as they learn how to source passive candidates themselves. Not all companies are going to bring this in-house (many are), but no matter where you go, LinkedIn is now the most powerful tool on the web for sourcing (professional candidates).

LinkedIn is not Facebook. This is a company with a very different business model, personality, and focus. While we know that LinkedIn does live and die by the size of its membership, the company is now becoming very focused and educated about the needs of corporate recruiters and talent management professionals.

LinkedIn is disrupting the market for job boards, advertisers, recruitment service firms, and recruitment software companies. Maybe Taleo sold to Oracle at just the right time – the market for recruiting tools is shifting, away from tools for resume management and workflow toward new tools for sourcing, talent analytics, assessment, interview management, and search.

We estimate that the total worldwide recruiting market is over $130 billion in software, services, content, consulting, and staff. (The Talent Acquisition Factbook® has all the numbers.)

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1) Temporary agencies (staffing agencies) will either be nearly replaced by LinkedIn or some other social-network type of recruitment, or you’ll only use them if you need ‘a body’, instead of something specialized.

2) Monster and CareerBuilder will either be bought by someone larger, or will fade out, due to all the spam, excessive advertising, or the constantly bombardment of job ads trying to recruit people to be insurance sales associates.

3) The sending/requesting of resumes will decrease incrementally and the question will be “Are you on LinkedIn?”; I give it 5 years and the resume will go the way of the eight-track.

4) Instead of creating a resume, people will begin using sites like WordPress as a resume-building website. They might even start creating business cards, that have those sites on them.

5) Give it time and part-time/retail job recruiters/managers will be searching Facebook for their talent. Honestly, it should be them coming to us, not us searching for them.

This is unlikely to happen until someone really standardizes the resume format. SHRM has started a few ANSI standards for various elements of measurement, but there is no “standard” XML format for resumes yet. I think LinkedIn has about as much chance as anyone to create this, and already they’ve started by allowing people to extract their resumes into a standard format.

As a freelance writer, I’ve found LI very useful for both networking and job assignments. Conversely, my husband, who has an MPA, 20 years experience as a city manager/asst city manager, and 12 years as a transportation planner, has never found a job using the Internet. We recently learned that employers admit that only a tiny percentage of new hires come from Internet job sites. Steve has joined LI, but so far it hasn’t helped much. He has contacted recruiters, telling them that he is interested in any consulting, management, etc., jobs, but none of them is interested in assisting him with his search. How would ya’ll advise someone who has this level of education and experience to proceed? It frustrates me – I know there are employers out there who need someone as skilled and experienced as Steve, but it seems impossible for one to find the other!

However I would like to share a different vantage point. In developing markets like India, LinkedIn is still evolving. The job market here is heavily dependent on referrals and headhunters. Yes I agree that there exist job portals such monster and naukri.com but most job seekers know that these are mostly redundant and don’t throw up good openings. LinkedIn should be the way to go in the future, but it needs to better its game and from what I believe its not punching enough. Its use is on the rise in the senior management level positions where its used as a referral and recommendations check, but percolation down the pyramid is something which is in the pipeline. ( or so I would like to believe).

The way Linkedin could move ahead is hosting fairs and information sessions in the top echelon schools of science and management. But that’s for starters, let LinkedIn figure out how it can better its India strategy ( or any developing market for that matter)

LinkedIn is a vital key for webrecruit – Let me share with you 4 facts which might surprise you:

1. Webrecruit is the single largest recruiter on LinkedIn, in the UK. 2. This year we will hire in excess of 8000 people for over 2000 clients. 3. More of these hires come from LinkedIn than from any other source, including Job-boards. 4. Out of 1.2 million groups on LinkedIn, ours is in the top 100.

At last, an article that gives LinkedIn due credit! I’ve been a consultant / executive recruiter for a top search firm at one Asian market, and LinkedIn has been of great help–I regard it as one’s ‘Online CV’. Articles that hype up FB and other talent/job portals are just bollocks, they don’t have the same impact in the talent sourcing field as LinkedIn.

I’ve used a lot of talent and job portals–some requiring a paid account–and a free LinkedIn account with a solid network reach is still X-times more effective. I’m happy that they’re starting to reap the financial benefits of their platform.

I have been on LinkedIn since early 2004 within about six months of their launch. I joined for the business networking capabilities at the time. Over time, they expanded on this with groups and other features designed to improve business communication.

Then, they decided to launch recruiting solutions. While some do use LinkedIn for finding work, a good majority despise that this is available now on LinkedIn. Did LI ever ask their current users if this was something we wanted – no. They again turned to selling the data streams.

Beyond me, I will give a small example. One night I was out with a COO who was previously a regular user of LI. I say previous, because he ended up leaving after being contacted in one particular month by eight different recruiters. No offense to recruiters, but it is not what he joined LI for.

So, LI’s issue is it needs to decide what it wants to be… a corporate social network or a recruiting database. Not everyone is happy with this direction, in fact, most are not – I have asked this question of many of my contacts and the feeling is the same.

Perhaps these articles should look at both sides of the equation – for companies /recruiters and professionals.

LI is growing because users like myself reach out to other professionals for business contact purposes. LI is changing direction and for many that joined for the business contact purposes, it is becoming less useful with each passing week.

Finally, LI is slowly adopting the death kneel of a social network. Social networking is about openness and sharing… LI, in order to sell their way overpriced recruiting solutions, is closing this up so that they can sell the users on LI.

I think this will continue working for a while. I also believe it is going to have some long term repercussions for LI as they become just another job service.

Very apt comments Chris! I have the same grief with Linked In. I believe a vast majority of Linked In users do not use it for anything more than an online address book but their profile data is sold by Linked In to generate revenue.

If you would consider an alternative professional networking site built with a recruiting solution that is very private and silent, do check out www.antezen.com which is what I started precisely to get away from the Linked In for the reasons you illustrate above.